Three major hospital deals announced this past week provide further evidence that the nation's healthcare sector is continuing its steady pace towards consolidation.
Catholic Health East / Trinity Health
In perhaps the largest potential merger deal this year, the boards of Newtown Square, PA-based Catholic Health East and Novi, MI-based Trinity Health announced last Wednesday that they signed a non-binding letter of intent to become a unified national health system.
The deal would create a giant Catholic health system serving 21 states from coast to coast with 82 hospitals, 89 continuing care facilities and home health and hospice programs that provide nearly 2.8 million visits annually. More than 87,000 employees, including 4,100 employed physicians, would provide care in the new system, the two systems said.
"Trinity Health and Catholic Health East are strong Catholic healthcare systems that share a Gospel-based mission and an unyielding commitment to care for people who are poor and underserved," Trinity Health Board Chair Sister Mary Mollison said in a joint media release. "This consolidation advances the vision of congregations of Sisters that founded these health care ministries, addresses the changing healthcare environment and takes a bold next step for Catholic healthcare."
If the deal is finalized, Trinity Health CEO/President Joseph R. Swedish would become president/CEO of the new health system, and Judith M. Persichilli, president/CEO of CHE, would become executive vice president.
The new system would have annual operating revenues of about $13.3 billion and assets of about $19.3 billion, and would return almost $1 billion to its communities annually in the form of charity care and other programs, the two systems said.
Both systems described the negotiations as "preliminary" and said their boards and management will meet over the coming months with a goal of signing a definite agreement sometime next spring.
Catholic Health East includes 35 acute care hospitals, four long-term acute care hospitals, 26 freestanding and hospital-based long-term care facilities, 12 assisted-living facilities, four continuing care retirement communities, eight behavioral health and rehabilitation facilities, 31 home health/hospice agencies and numerous ambulatory and community-based health services.
Trinity Health is the 10th largest health system in the nation and the fourth largest Catholic healthcare system in the country, by total number of hospitals and total bed count. Trinity Health operates 47 acute-care hospitals, 432 outpatient facilities, 32 long-term care facilities, and numerous home health offices and hospice programs in 10 states.
Ascension Health / HCA Midwest Health System
Also last week, St. Louis, MO-based Ascension Health announced that it is talking with HCA Midwest Health System to sell St. Joseph and St. Mary's Medical Centers and other Carondelet Health subsidiaries in Kansas City, MO.
Fleury Yelvington, president/CEO of Carondelet Health, said that if the negotiations lead to a sale HCA Midwest has said it would work with the local diocese to preserve the hospitals' Catholic heritage. "Being a part of a system with a large local presence would strengthen Carondelet's position in this competitive market which is critical to ensure the system's long-term success amidst the myriad of changes that are occurring as part of health care reform," Yelvington said in prepared remarks.
HCA Midwest Health System issued a brief statement confirming that it "is currently in the beginning stages of negotiations with Ascension Health to acquire Carondelet Health. We do not have a completion date for these discussions. We believe that a merger of Carondelet Health and HCA Midwest Health System could help to ensure long-term success for both organizations."
Seward Health / Massachusetts General /Brigham and Women's
Also last week, the Boston Globe reported that Seward Health Care System announced that it would transport its most critically injured patients at 10 community hospitals it operates around the city to emergency departments at Massachusetts General and Brigham and Women's, two Boston hospitals operated by Partners HealthCare System. In addition, Steward hospitals will tap the expertise of Partners physicians to establish trauma centers to handle less-severely injured patients.
The agreement was announced last week in a letter from Michael Callum, MD, president of Steward Medical Group, to the group's 700 specialists and primary-care physicians.
John Commins is a content specialist and online news editor for HealthLeaders, a Simplify Compliance brand.